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Poland's media market is becoming increasingly perilous. In the last year it has killed off one national newspaper, bankrupted the publisher of a business monthly and caused severe problems for a news weekly.
But with advertising expected to have increased by 10 per cent in 2005 despite the casualties, new entrants -- some with very deep pockets -- are still scrambling to get in.
The latest offering is from Agora, the publisher of Gazeta Wyborcza, Poland's second largest daily by circulation and overwhelming leader in advertising sales. Last month Agora launched Nowy Dzien (New Day), a general interest daily paper.
In a crowded market -- where there are three free newspapers, two national tabloids, the mid-market Gazeta Wyborcza, the upmarket Rzeczpospolita, a specialised business and legal press and a multitude of local newspapers -- a new paper is a risky venture. Poles also have one of Europe's lowest rates of newspaper readership.
"This is a very appetising market," says Wanda Rapaczynska, Agora's chief executive. "We wouldn't have come out with this title unless our research showed that there is space for the paper in the market."
Nowy Dzien is a Berliner format paper -- slightly larger than a standard tabloid -- and avoids the bare breasts and breathless entertainment news of the tabloids while shunning the heavy business and political news favoured by the upmarket papers. "Nowy Dzien is mid-market and also appeals to women. In Poland women have lower readership numbers than men," says Mrs Rapaczynska.
But the title, launched on November 14 with a print run of 812,000, is showing early signs of trouble. Industry insiders say sales have dropped steeply to about 170,000 a day -- a figure Agora would not confirm.
The company's goal is to steady sales at 250,000 a day this year. The launch costs -- about 30m zlotys (£5.2m) in the fourth quarter -- will have a negative impact on Agora's year-end results.
"This newspaper feels a lot like the free papers that are handed out in the subway," says Konrad Pudlo, director of Expert Monitor, a company that tracks the Polish media market.
"The articles don't really grab me. I can't really see who it is aimed at. It won't be read by Gazeta Wyborcza readers and it won't be read by tabloid readers."
However, the launch makes sense from an advertising perspective, says Jakub Bierzynski, managing director of OMD Poland, a media planning company.
"I think they are counting on taking readers from local papers, which have a circulation of about 4.0m," he says. "If there is an easy market to take, it is the local market."
Having one large paper instead of a myriad of regional ones would be appealing to advertisers trying to reach into smaller towns and cities.
The launch of Nowy Dzien is also meant as a deterrent to any further expansion in Poland by Axel Springer, the German media conglomerate that in 2003 launched the Fakt tabloid, modelled on Germany's successful Bild. Fakt is now Poland's largest daily with a circulation of 493,000.
Axel Springer is considering launching an upmarket daily, possibly modelled on Die Welt Compact, to compete directly with Gazeta Wyborcza, which has 35 per cent of the newspaper advertising market, while Fakt has only 8.0 per cent.
The publisher of Zycie Warszawy, a large local paper in the Polish capital, also plans to launch a quality national daily by next spring.
The top end of the market is the most difficult to penetrate because readers tend to be more loyal to their papers than downmarket subscribers, says Mr Bierzynski.
"There aren't oceans of space at the top of the market," says Mrs Rapaczynska.
There are also reports that a fourth free metropolitan daily is being planned.
Despite the scepticism over plans to bring in a new quality title, Axel Springer has a record of success in penetrating the Polish market. As well as Fakt, in 2001 it launched the Polish edition of Newsweek, now one of Poland's three largest news weeklies.
The bottom line is that it takes big sums of money and steady nerves to enter Poland's quickly maturing market. Less well-financed ventures, such as the 2004 attempt by a group of British businessmen to start Zycie, a national daily, have failed.
The Ozon news weekly, owned by Janusz Palikot, Polish businessman and politician, had its debut in April with a circulation of 92,000 but is down to about 40,000 and its future is in doubt.
Business Press, the publisher of Businessman Magazine, Poland's oldest business monthly, declared bankruptcy earlier last month.
With new titles squeezing into every niche, space for expansion in Poland looks very limited, which is making Agora look abroad. "A few years ago we thought it would be hubris to go west," says Mrs Rapaczynska, suggesting her company would be interested in buying a German title because of the geographical proximity to Poland.
"We are now at a stage where we are beginning to look more seriously at western Europe."
Under syndication arrangment
with FE
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